Portugal Taxes for US Expats (2026)
Short answer: as a US citizen you'll always file with the IRS, but you rarely pay double. The Foreign Earned Income Exclusion ($132,900 in 2026) and the foreign tax credit usually wipe out the US bill, and the US–Portugal treaty prevents genuine double taxation. Once you pass 183 days in Portugal you become a tax resident, taxed on worldwide income up to 48%. This is general information, not tax advice.
Do Americans pay tax twice in Portugal?
You file twice, but rarely pay twice. The US taxes by citizenship, so you keep filing a US return abroad. Two tools usually cancel the US bill: the Foreign Earned Income Exclusion (FEIE) — up to $132,900 of earned income in 2026 (IRS) — and the Foreign Tax Credit (FTC), a dollar-for-dollar credit for Portuguese tax paid, which often works better since Portuguese rates are high.
There is a US–Portugal tax treaty (in force since 1994) that allocates taxing rights, but its "saving clause" lets the US tax its citizens as if the treaty didn't exist — so the treaty alone doesn't remove your US filing; FEIE and FTC still do the work.
When do you become a Portuguese tax resident?
You become a Portuguese tax resident if you spend more than 183 days in Portugal over a 12-month period, or keep a habitual home there intending to reside. From that point, Portugal taxes your worldwide income on a progressive scale (roughly 13% up to 48% above ~€81,200), plus a solidarity surcharge of +2.5% over €80,000 and +5% over €250,000.
Is the NHR tax break still available (IFICI)?
The famous NHR regime closed to new residents on 1 January 2024. Its replacement is IFICI, informally "NHR 2.0":
- 20% flat rate on qualifying Portuguese employment/self-employment income, for 10 years.
- Eligibility: you weren't a Portuguese tax resident in the prior 5 years, and you work in a qualifying high-skill/R&D/innovation activity (with the relevant qualifications).
- Key limit: unlike the old NHR, IFICI excludes pensions and most passive income — so it does little for retirees. (This pension exclusion is widely reported; confirm your case with a Portuguese tax adviser.)
What US reporting do you still owe?
Living in Portugal doesn't end your US filing duties:
| Form | When it's required |
|---|---|
| FBAR (FinCEN 114) | Foreign accounts together exceed $10,000 at any point in the year |
| Form 8938 (FATCA) | Foreign financial assets over $200k (single, abroad) at year-end or $300k anytime; $400k / $600k if married filing jointly |
Both can apply in the same year and are filed separately. See our banking guide for how your Wise, Revolut and Portuguese accounts factor in.
FAQ
Do Americans pay tax twice in Portugal?
You file with the IRS and (once resident) with Portugal, but the FEIE ($132,900 in 2026), the foreign tax credit and the treaty usually prevent paying twice.
When am I a Portuguese tax resident?
After more than 183 days in a 12-month period, or with a habitual home there — then worldwide income is taxed up to 48%.
Can I still use NHR?
No — NHR closed to new residents in 2024. IFICI (20% flat, 10 years) replaced it but excludes pensions and most passive income.
Related guides
Sources
- IRS — 2026 FEIE ($132,900) · IRS — FBAR vs Form 8938
- PwC — Portugal personal income tax · US–Portugal treaty (IRS)